The new smartphone will be made in joint with HTC and will offer Facebook's own version of a mobile operating system. Some have speculated that Facebook may use a version of the Android mobile operating system, since it can be modified, but that part is unclear for now.

To help with the mobile venture, Facebook has hired former Apple employees Greg Novick, who developed the touchscreen user interface; Scott Goodson, who helped create the stock market application; Tim Omernick, who worked on the device's software, and Chris Tremblay, who also worked on the software.

The Facebook smartphone is likely the answer to one of the social giant's major issues: mobile advertising. Last year, Facebook had $3.15 billion in total advertising sales, but none of this came from ads on mobile devices.

Also, Facebook CEO Mark Zuckerberg recently said that shifting to mobile was Facebook's greatest challenge because the way people use it is much different than on a desktop computer.

By releasing a smartphone, Facebook would be able to monetize mobile in a much larger way. Also, by designing its own operating system for the mobile device, the shift to a mobile Facebook experience should closely mirror the desktop version.

The Facebook smartphone is due out in mid 2013.

In addition to creating its own smartphone, Facebook also said it plans on improving the existing Facebook iOS app. Many users have complained about it being slow or not working properly, but Facebook is on the case.

I'm pretty sure the point isn't people 'don't use fb' in fact, that is highly untrue. It's volume of usage is above in Google.com itself. It is the single most used web site.

The issue is that while facebook is a good enough brand for a social network, I don't know ONE person who wants a phoen produced by or emblazened with the logo of FB. It makes no sense, especially when MS is a customer prime for integration. I'm assuming costs forced them to rather invest in their own OS rather than form some type of exclusive feature arrangement with MS, but let me tell you...

No one wanted a facebook phone with it was offered by MS in the past and no one will want it now. There is not a single smart phone that cannot get on FB in one manner or another and frankly there isn't any room for a new contender in the OS arena.

It's questionable in a multitude of ways and is seemingly a decision that can only be born of shareholder greed and stupidity.

Right now my gf just got home and where is she right away right next to me now?... FB. Google is only a portal when she wants to go somewhere new. FB can list whatever ads it likes or more likely what that particular viewer likes to buy. This happens before she even realizes there is something she wants. Google is outside the loop and that is not where Google wants to be.

But, as long as FB is using Google to serve up the appropriate ad for the right person it's quite the symbiotic relationship. Why indeed should FB create their own OS unless they decided to build their own competing search engine?

Facebook as a company makes billions... a million a day in ad revenue alone. How the hell is that over? People WANT a social network, even if YOU and your buddies (maybe) don't. This is exhibitted by the fact FB use continues to rise, not decline.

I wonder how you assess a successful bussiness? If it's something that you want? Or if its continuing to be profitable?

While I agree in principal, profitability in a volatile market doesn't ensure continued success. It takes vision and ability to execute future trends.

Kodak was highly profitable right up until digital cameras became mainstream, then it was like driving a truck off a cliff.

I don't know regarding Facebook. I'm seeing more and more people getting tired of it. At one time, Myspace was the hottest social network on the planet and see how quickly that died when something better came along.

With Facebook's long history of "protecting your information" why would anyone want this product? Watch the EULA of the handset will have traps in it that will make you agree to Facebook monitoring your phone calls, texts, and whatever else you do on the handset.

FB is an APP. Period. By definition, that's what it is, what it has been, and what it always will be.

There is zero sense in making a bespoke FB device - unless FB honestly thinks they're going to neuter the FB app for other phones to try to push people to use their own device...which would end horribly for them.

This is nothing more than the thrashing about of a company trying to figure out some way to create growth when there is no natural room left for them to grow. IPO came about 5 years too late.

i do have an account; it helps me keep in touch with overseas friends&family... but i wouldn't buy their phone.

i don't see what they could offer in the mobile space that others can't. with android, i can choose from many different phones; and they all have a facebook app. same with windows mobile. FB will have just ONE model, like apple, but unlike apple, they aven't got a huge catalog of apps and the world's best marketing (not to mention the world's most loyal fans).

i also believe that FB will use this device to kick their data gathering into a higher gear, and i'm not really into having my whole private and personal life sitting on one of zuckerberg's servers.